The fundraising also reduces the likelihood Santander will spin off and separately list its British business, as it has less need to raise capital from a partial sale, bankers said.

“If you have a strong capital base and are profitable, you are unlikely to sell a good asset,” one banker said in reference to a possible UK flotation, which the bank has considered in recent years but pushed back several times.

The latest guidance from Santander is that a sale would not happen in 2015.

Santander shares closed down nearly 15 percent at 5.89 euros, earlier hitting a 13-month low, after the bank sold 1.26 billion new shares late on Thursday at a 10 percent discount to its previous share price to improve its capital strength and provide funds to lend more.

Botin also cut the bank’s dividend as part of a plan to remove any doubts about its capital strength, the latest sign she is stamping her mark on the bank after taking over from her late father, Emilio, who ran Santander for 28 years until his death last September.

“Ana Patricia is showing she has character and she’s wanted to make her own mark with the recent decisions, but deep down the philosophy is not that different from her father’s,” said Enrique Quemada, CEO of Spanish investment bank ONEtoONE.

“She is betting on organic growth, but this capital raising will allow her to keep growing the bank, and really this is a demonstration that the bank is betting on size, size, size.”

After 120 days in charge, the move to tackle capital and dividend strategy, after previous changes in governance and leadership, means the focus will shift to growth, Botin said. “The objective of this transaction is to accelerate our plans to grow organically,” she said in a memo to staff.

INCREASED LENDING

She said growth in the markets Santander operates in should average more than 3 percent in 2016 and it wanted to take advantage by increasing lending and improving loyalty among its 100 million customers. That could be based on the success of the bank’s 123 current account in Britain, which has grown from 1 million to 3 million customers in less than three years.

Bankers said she was likely to target Britain and the United States, where both economies are improving, as well as Spain and Portugal. The bank wants to grow its risk-weighted assets by about 6 percent in 2015, or roughly 35 billion euros, through more lending for example.Santander said its core capital ratio on the basis of the full Basel III rules laid down by global regulators should reach nearly 10 percent this year and 10 to 11 percent by 2016. Some analysts said that could put pressure on other banks to follow suit.

Santander denied it would use the capital to fund acquisitions, as in a past route to rapid expansion under Emilio Botin. But the hike still prompted speculation it could look at purchases, with Italy’s Monte dei Paschi (BMPS.MI) and Portugal’s Novo Banco seen as possible targets.

Shares in Monte Paschi had jumped 12 percent on Thursday, but pulled back 4 percent on Friday as the talk cooled.

There was demand over $13 billion of shares in the offer, with orders placed by 235 investors, Santander said.

Goldman Sachs (GS.N) and UBS UBSG.VX were joint bookrunners for the offer, which was unusually large for an accelerated bookbuild offer - a type of share placement which takes hours rather than the weeks sometimes needed for rights issues.

Close to 80 percent of the shares were sold to U.S. and UK investors, the bank said, with most of that accounted for by institutions in the United States, according to a source familiar with the matter.

About 10 percent was placed with clients in continental Europe, Santander said.

Additional reporting by Sarah White and Elisabeth O'Leary in Madrid; Editing by David Holmes and Michael Urquhart